WASHINGTON – The Senate passed a surprise extension for the Paycheck Protection Program to August 8 by unanimous consent Tuesday night, just hours before it was set to close down.
The legislation would extend the deadline for when the PPP can accept applications for forgivable loans. The bill gives the Small Business Administration the authority to continue approving loans to businesses that apply.
However, the House of Representatives will need to pass the legislation, and send it to President Donald Trump for his signature to keep the money flowing. Both chambers of Congress are set to adjourn for recess by the week’s conclusion.
The massive loan program has helped keep millions of small businesses afloat during the coronavirus pandemic and already has disbursed more than $500 billion to roughly 4.8 million businesses, most of them mom-and-pop outfits such as nail salons and retail stores.
But there is still more than $130 billion left unallocated, and scores of hospitality businesses teetering on the brink of insolvency.
Sen. Ben Cardin, D-Md., the top Democrat on the Small Business Committee, said on the floor that senators picked Aug. 8 because that’s the end of the Senate’s next work period and lawmakers are hoping to pass the next relief package by then.
He said, “The resources are there. The need is there. We just need to change the date.”
Sen. Marco Rubio, R-Fla., the chairman of the Small Business Committee, tweeted that he had no objections to extending the application deadline “but the vast majority of #SmallBusiness that wanted to benefit from the program have already used it.”
Additionally, Sen. Susan Collins, R-Maine, who helped negotiate the initial small business portions of the March coronavirus relief legislation, said that the extension would make certain we “don’t see an interruption in this program” while a fifth relief bill is being negotiated in Congress.
The unanimous agreement Tuesday night was unexpected, as lawmakers have clashed over issues regarding the program, including legislation regarding how to possibly redirect the unused $130 billion.
Sen. Rick Scott, R-Fla., tried to change the bill to include a prerequisite requirement that any new loans must go to businesses that have witnessed a decline in revenue because of the pandemic.
However, Cardin rejected the change, citing concerns of changing guidelines mid-program. Scott backed down and the application extension cleared the Senate.
Treasury Secretary Steve Mnuchin told lawmakers Tuesday that the administration is negotiating the extension of PPP, while expressing support for re-purposing the more than $130 billion.
“I’ve already had conversations with the [Small Business Administration] committee in the Senate about repurposing that $135 billion and think that should be done, and look forward to working with both the House and the Senate so we can pass legislation by the end of July,” Mnuchin said.
The program offers firms employing 500 or fewer workers low-interest loans of up to $10 million to cover their pandemic-related costs. Companies apply for the money through banks and other lenders that certify the loans, which are underwritten by the Small Business Administration.
The program has come under fire for including hundreds of publicly traded companies receiving PPP loans meant for small businesses. After initially rebuffing requests to disclose the list of PPP recipients, Mnuchin told lawmakers Tuesday the list of those receiving at least $150,000 under the program would be released by the end of this week.
Contributing: Ledyard King